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Facebook stock hits record high as earnings beat Wall Street estimates

Thursday, 24 July 2014 - 8:45am IST | Place: San Francisco | Agency: Reuters

Facebook Inc's fast-growing mobile advertising business helped drive a 61 percent increase in revenue during the second quarter, beating Wall Street's financial targets and sending shares to a record-high in after-hours trading on Wednesday. The world's No.1 Internet social network said on Wednesday that it saw increased interest from both advertisers and from users during the second quarter.

Facebook now counts 1.5 million advertising customers and the company's ad business saw strong growth across all of its geographic regions in the second quarter, Chief Operating Officer Sheryl Sandberg told Reuters in an interview on Wednesday.

"We're seeing our existing advertisers spend more and we're seeing new people come on to the platform," Sandberg said.

Facebook said that mobile advertising revenue represented 62 percent of its ad revenue in the second quarter, up from 41 percent in the year-ago period and 59 percent in the first quarter of 2014.

Facebook's newsfeed ads, which inject paid marketing messages straight into a user's stream of news and content, have ignited Facebook's revenue growth and bolstered its stock price during the past year. Shares of Facebook, which finished Wednesday's regular trading session at $71.29, have nearly tripled since last July.

Overall revenue totaled $2.91 billion in the three months ended June 30, versus $1.81 billion in the year-ago period. Analysts polled by Thomson Reuters I/B/E/S were looking for revenue of $2.81 billion.

The world's largest Internet social network said it now counted 1.32 billion monthly users. Roughly 62.8 percent of those monthly users accessed Facebook's service every day in the second quarter, up from 60.8 percent in the year-ago period.

Facebook posted $791 million in net income, or 30 cents a share, compared with $333 million or 13 cents a share in the second quarter of 2013. Excluding certain items, Facebook said it earned 42 cents a share in the second quarter, surpassing expectations for 32 cents a share.

Shares of Facebook were up roughly 4 percent at $74.10 in after-hours trading on Wednesday.




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